Manufacturing Purchasing Manager Surveys Released

November 1, 2010

The dollar firmed 0.4% against the Swiss franc and briefly touched 80.25/USD overnight, just 40 pips from its 1995 record high.  The dollar also fell 0.7% against the Australian dollar, 0.5% versus the kiwi, 0.3% relative to the Chines yuan and euro, and 0.2% against the Canadian dollar and sterling.

Asian stocks rose in response to some encouraging PMI readings, with gains of 2.8% in China, 2.4% in Hong Kong, 1.7% in South Korea, 1.9% in Thailand, 1.6% in Singapore and India, 1.1% in Sri Lanka and Taiwan and 0.8% in Australia.  However, Japan’s Nikkei fell 0.5%, and the rally did not carry into Europe where the Ftse is just 0.1% firmer.

Ten-year German bund and British gilt yields fell six basis points, while the 10-year JGB is up two basis points.

Oil and gold prices rose by 0.8% and 0.3% to $82.09 per barrel and $1361.50 per troy ounce.

Many country purchasing manager surveys were published, but some European will not be learned until tomorrow because of All Saints Day observances.

  • The official Chinese PMI-manufacturing score rose to 54.7 in October from 53.8 in September and 51.7 in August.  The HSBC Chinese PMI improved to 54.8 from 52.9 in September and 51.9 in August.
  • India’s reading rose 2.1 points to 57.2 in a sign of accelerating momentum after such had eased from a 27-month peak in May.
  • Turkey scored a 54.3 PMI, highest in five months and up from 50.3 in September.
  • Russia’s PMI index of 51.8 was 0.6 points better than the tally in September.
  • Taiwan’s index slid 0.4 points to 48.6. 
  • Likewise, South Korea’s PMI faltered to 46.7 from 48.8 in September, 50.9 in September, 50.9 in August and 53.2 in July.  The appreciation of the won has become a mounting policy concern in Seoul.
  • The British PMI-manufacturing index rebounded to a three-month high of 54.9 from a 10-month low of 53.5 in September.
  • The Dutch PMI rose sharply to 55.4 from 52.9 a month earlier.
  • Sweden’s index for October was 61.8 after 63.3 in September and 60.6 in August.
  • The Swiss index continued settling back, posting a score of 59.2 versus 59.7 in September, 61.4 in August, and 66.9 in July.
  • The Norwegian PMI was 54.2 last month after 53.1 in September, 49.4 in August and 54.9 in July.
  • The Czech PMI dipped 0.8 of a point to 57.2, which was similar to August’s 57.3.
  • South Africa’s PMI posted a sub-50 reading for the fourth time in five months with 49.8, which nonetheless was 1.2 points better than in September.
  • A common theme in many of these surveys was accelerating input price pressure.

Britain’s Hometrack house price index fell 0.9% on month in October and recorded the first on-year drop (minus 0.1%) in nine months.

Swedish auto sales were 21.5% greater in October than a year before.

Australian house prices edged only 0.1% higher last quarter and recorded an 11.5% on-year gain, down from 18.4% in the year to 2Q.

Japanese total auto sales were 23.2% lower in October than a year earlier.  Non-mini auto sales posted a 26.7% drop.  Japanese wage earnings in September were just 0.9% higher than a year earlier, up from 0.4% on-year growth in August but below the results in June and July.

South Korean CPI inflation accelerated to 4.1% in October from 3.6% in September because of the impact of energy and food.  Core CPI remained at 1.9%.  South Korea had a USD 6.9 billion trade surplus in October, as exports (+29.9%) expanded much more quickly than forecast.  These data rekindled some speculation that the Bank of Korea may not be able to pause rate increases much longer.

India’s USD 9.1 billion trade deficit in September was 32% wider than a year earlier, as imports (26.1%) advanced faster than exports (23.2%).

The Indonesian trade surplus widened to USD 2.55 billion in September from $1.49 billion in August.  A tiny deficit has occurred in July.  Indonesian CPI inflation of 5.7% in October was similar to September’s 5.8% but down from 6.2% in July and 6.4% in August.

Hong Kong retail sales posted on-year growth of 17.2% in value terms and 15.8% in volume in September.

An agreement on Portugal’s budget next year was reached. 

The United States reports construction spending, personal spending and income figures and the manufacturing PMI survey later today.  The market’s attention remains fixated on tomorrow’s mid-term U.S. election and upcoming interest rate policy announcements from the Fed, BOJ, ECB, Bank of England, and Reserve Bank of Australia later this week.

Copyright Larry Greenberg 2010.  All rights reserved.  No secondary distribution without express permission.

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